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Strategies & Market Trends : Options -- Ignore unavailable to you. Want to Upgrade?

To: Jill who wrote (5731)	4/18/2000 9:17:00 AM
From: Steve 667	Read Replies (2) \| Respond to of 8096

Jill, I missed your response a few weeks ago. Sorry. I appreciate your answer and you are absolutely right, the risk is in the original stock purchase! The problem I have with this strategy is that you are essentially selling and limiting your potential gain if the stock goes up while assuming a much larger risk if the stock goes down. Seems on the surface that the risk/reward ratio is backwards. This seems to me to be a strategy which will work 3 times out of 4, but that fourth time you will loose much more than you made on the other 3. Cuz markets go up and down as we have seen recently. This is just my intuition, I could be dead wrong. What I would really like to see is someone who has used this strategy over a period of 3 or 4 years and CONSISTANTLY made money doing this. Do you know of such a person? Side note: PAL's example certainly did use margin to buy the entire JDSU position. Sorry again for the late response. Steve 667 * To the optimist, the glass is half full. To the pessimist, the glass is half empty. To me, it is obvious that the glass is twice as big as it needs to be.